Financial Disclosure Guide for Political Parties
Updated: 6 July 2016
Information to be disclosed in the political party disclosure return
Part 1a: Total receipts for financial year 1 July 2015 to 30 June 2016
Section 314AB(2)(a) of the Act requires that the total amount received by, or on behalf of, the political party during the financial year must be disclosed.
To complete this part of the return, the political party must disclose all transactions that result in amounts, both above and below the disclosure threshold, being received from external entities.
Amounts received include, but are not limited to the following:
- gifts of money
- gifts-in-kind of services or goods
- membership subscriptions
- loan monies received
- returns on investments
- proceeds from the sale of assets
- public funding provided by the Commonwealth or a State or Territory.
When determining what transactions need to be included in Part 1a of the return the following principles should be observed:
- Transactions between the federal party and/or state or territory branches are included as these are separate entities for disclosure purposes. For example, money received by a local campaign committee from the federal secretariat is reported as a payment by the federal party and as a receipt by the state branch.
- Transactions by a Senate group whose members are endorsed by the political party and transactions of the campaign committee of a candidate endorsed by the political party must be included in the political party or the state or territory branch return.
- Transactions by persons acting on behalf of the political party or state or territory branch, including candidates at federal and state elections must be included in the return.
Examples of receipts that are required to be included in the calculation of 'total receipts' at Part 1a of the return:
- A gift of $15 000 cash from a donor.
- A donation of printing of stationery that if purchased commercially would have been priced at $350.
- Interest on term deposit of $2 755.
- Loan of $7 000 cash received from party member.
- Three separate gifts of $8 000 each are received from a person on different days.
- A cheque for $400 relating to the sale of office furniture from the national office of the party.
- Two separate donations are received from the same person on different days. One amount is $9 500 and the other is $35 000.
- Both the $9 500 and $35 000 amounts are included
Disclose gross figures, not net figures
Section 314AB of the Act requires the disclosure of amounts received, not of income or profit. The return, therefore, must be completed on a gross basis inclusive of GST and merchant fees. Transactions are to be reported separately, not netted off against each other.
- a fundraiser taking $14 000 with costs of $12 750 and a net profit of $1 250 is disclosed as:
- a receipt of $14 000; and
- a payment of $12 750.
- a transaction through American Express for $17 600 of which $16 864 was deposited in the bank account following the merchant deducting their fee should be disclosed as the full amount of $17 600.
- a receipt of $20 000 subsequently refunded must be disclosed:
- as a receipt of $20 000
- and also a payment of $20 000.
Which transactions are not to be reported in the return?
Internal transactions are not to be reported as they result in double counting of amounts received and so overstate the total receipts of the political party.
Examples of internal transactions:
- Transactions between the party and its party units (such as local branches and campaign committees).
- Transactions between individual party units within a state or territory.
- Transfers between a party's bank accounts, for example:
- a transfer from the party's bank account to a party unit's bank account,
- a transfer between bank accounts both held by the party,
- a transfer from a transaction account to an investment account, such as a term deposit account.
Other transactions that are not to be reported in the return include:
- commercial discounts received in the normal course of business,
- volunteer labour, such as persons handing out how-to-vote cards or services provided by individuals who are party members,
- interviews and news items published in a newspaper or broadcast in the electronic media.
Material presented on an 'advertorial' basis (that is, a combination of paid advertising and interviews) should be disclosed consistent with the promotional intention of the activity.
Part 1b: Amount calculated to be the value of gifts-in-kind
This is the amount calculated to be the value of gifts-in-kind which would have been included in the 'total receipts' amount disclosed at Part 1a.
Gifts-in-kind may be goods or services received for which no payment (in cash or in kind) or inadequate consideration is made. Inadequate consideration is where the benefits obtained are clearly of a lesser value than the payment made. Inadequate consideration includes discounts provided that are over and above those that would be offered under normal commercial arrangements.
These gifts are to be disclosed for an amount that reflects the fair value. That is, the normal commercial or sale value of the item or service as evidenced by arms-length transaction or comparative quotations or expert assessment.
Examples of gifts-in-kind include:
- free/discounted services such as legal advice, accounting services or web and IT services,
- wages or salaries (including on-costs) incurred by an employer whose employee works for the party during normal working hours while continuing to receive salary or wages from the employer (but not if the employee takes paid leave to work for the party),
- free/discounted use of premises or equipment and facilities
- free use of a motor vehicle, or free fuel or servicing of a motor vehicle,
- free/discounted time or production services by a broadcaster (except time provided by the ABC or SBS specifically for political broadcasting),
- free/discounted advertising by a publisher or advertising production service,
- free air travel or the free use of a private aircraft,
- loans provided interest free, or at rates that are less than those available in the commercial loan market,
- free/discounted printing, typesetting or associated services,
- free/discounted goods or services (for example, travel, artwork, sports memorabilia or electrical goods) for use in raffles or other fundraising activities,
- where a person pays a bill/account owed by the party.
Part 2: Amounts of more than $13 000 received in financial year 1 July 2015 to 30 June 2016
Sections 314AC(1) & (2) of the Act require that where an individual sum received by, or on behalf of, the political party from a person or organisation during the financial year is more than the disclosure threshold, details of that receipt must be disclosed.
As a matter of best practice the AEC recommends that multiple receipts of less than the disclosure threshold received on the same day from the same source should be considered to be a single receipt. Where the sum of those multiple receipts is more than the disclosure threshold, details of that sum should be disclosed.
The details to be disclosed are:
- Full name and address details of the person or organisation from whom the money or gift-in-kind was received.
- The sum of amounts received from that person or organisation.
- Whether the receipt is a 'gift/donation' or 'other receipt'.
The following requirements must be observed when disclosing the details of sums received:
- In the case of an amount received from an unincorporated association (other than a registered industrial organisation), the name of the association, along with the name and address of each member of the executive committee of the association must be disclosed.
- In the case of an amount received from a trust or foundation, the name and description of the trust or foundation, along with the names and addresses of the trustees must be disclosed.
Section 314AC(3)(ba) of the Act requires that where the sum received was the result of a loan the following disclosure must be made:
- For loans from non–financial institutions the requirements of section 306A(3) apply. For details regarding section 306A(3) refer to the 'Record of loan terms and conditions' section in this guide.
- For loans received from a financial institution, the sum of all amounts and the name of the financial institution.
- For loans received from a person, the sum of all amounts and the name and address of the person.
- In any other case, the name and address of the person or organisation from whom the money or gift-in-kind was received must be disclosed..
It is important to note that when consolidating amounts received from a single source, section 287(6) of the Act deems related body corporates to be the same entity.
Examples of amounts received that are required to be disclosed at Part 2 of the return:
- Funds relating to a loan of $50 000 received from a financial institution.
- Funds relating to a loan of $20 000 received from a non–financial institution.
- A distribution of $13 500 from a trust which was paid into the bank account.
- A non-monetary gift valued at $15 000 relating to commercial premises provided to the political party rent free. The market rent for the commercial premises is valued at $15 000.
- Two separate donations are received from the same person on different days. One amount is $9 500 and the other is $35 000.
- The $35 000 is disclosed in Part 2 as it is more than the disclosure threshold.
- The $9 500 is not required to be disclosed in Part 2 as it is less than the disclosure threshold.
A political party may provide additional clarifying information in situations where disclosure does not provide a clear picture of the underlying transactions. For example, political parties may wish to separately identify receipts such as membership fees, subscriptions or loan funds or where the receipt of a gift was subsequently returned.
Part 3: Total payments for financial year 1 July 2015 to 30 June 2016
Section 314AB(2)(b) of the Act requires that the total amount paid by, or on behalf of, the political party during the financial year must be disclosed.
To complete this part of the return, the political party must disclose all transactions that result in amounts, both above and below the disclosure threshold, being paid to external entities.
Amounts paid include, but are not limited to the following:
- administrative expenses
- purchase of assets
- electoral expenses
- loan repayments
- bank charges
- merchant service fees on credit/charge cards
- gifts received but subsequently returned or forfeited to the Commonwealth.
Examples of amounts paid that are required to be included in the calculation of 'total payments' at Part 3 of the return:
- Loan repayments paid totalling $32 000.
- Bank charges of $145 incurred.
- Merchant service fees totalling $3 400.
The same rules apply for using gross figures and eliminating internal transfers as explained for the completion of ‘Total receipts for financial year’ at Part 1a of the return.
Part 4: Total debts as at 30 June 2016
Section 314AB(2)(c) of the Act requires that the total outstanding amount, as at the end of the financial year, of all debts incurred by, or on behalf of, the political party must be disclosed
To complete this part of the return, the political party must disclose all debts that are outstanding as at 30 June 2016.
Debts include, but are not limited to the following:
- unpaid accounts.
Examples of debts outstanding as at 30 June 2016 that are required to be included in the calculation of 'total debts' at Part 4 of the return:
- Loan from financial institution with outstanding balance of $36 000.
- Loan from an associated entity obtained in a previous financial year with outstanding balance of $8 000.
- Invoices received, but not paid, from a supplier totalling $4 500.
Part 5: Debts of more than $13 000 as at 30 June 2016
Section 314AE(1) of the Act requires that if the sum of all outstanding debts incurred by, or on behalf of, the political party to a person or organisation during a financial year is more than the disclosure threshold details of that sum must be disclosed.
Unlike when completing 'amounts received' at Part 2 of the return, all outstanding debts owed to an individual or organisation, including amounts that are individually less than the disclosure threshold, must be considered in calculating whether the total debt to that person or organisation exceeds the disclosure threshold.
For debts outstanding that meet the criteria for disclosure required by section 314AE(1) the following details must be disclosed:
- Full name and address details of the person or organisation that the debt is owed to.
- The amount that is owed.
- Whether the debt is to a financial institution or non-financial institution.
In the case of a debt to an unincorporated association (other than a registered industrial organisation), the name of the association, along with the name and address of each member of the executive committee of the association must be disclosed
In the case of a debt to a trust or foundation, the name and description of the trust or foundation, along with the names and addresses of the trustees must be disclosed.
In any other case, the name and address of the person or organisation that the debt is owed must be disclosed.
Examples of debts outstanding that are required to be disclosed at Part 5 of the return:
- A debt of $14 000 owed to a party member, comprising two loans of $7 000.
- A debt of $15 000 owed to an associated entity which was obtained in a previous financial year.
- Bank overdraft account balance of $24 300.
- Amount owing on credit card totalling $14 450.
- Invoices received from supplier totalling $17 400.
- A loan from a financial institution with an outstanding balance of $45 000.